Many fashion labels and manufacturers do not directly employ the workers who make their garments. It is common for companies to give their work out to contractors who then often sub-contract other companies who in turn use more sub-contractors and so on and so on. At the bottom of such production chains, homeworkers can often be found working in terrible conditions for next to no pay and without the various protections that most factory workers have.

The principle behind Ethical Clothing Australia is, if manufacturers can make their production chains transparent, then exploitation can be easily identified and addressed. Ethical Clothing Australia encourages manufacturers to take an ethical approach and be responsible for staying informed of all the steps involved in the production of their garments. Instead of simply washing their hands of any responsibility for work done outside of their premises, under the Code, manufacturers are required to respond where they are provided with evidence that their suppliers are not meeting minimum legal standards.

Ethical Clothing Australia helps manufacturers ensure that their suppliers operate within the agreed standards as it provides a system to monitor, record and report what is being made, where it is being made, who is making it, and what rates and conditions the workers receive. The accreditation process traces who is paying the award rate to the workers and who is not. If the correct payment is not paid, the process allows the non-complying party to be given an opportunity to comply.

Once an application to become accredited is approved by the Code Committee, the production chains of accredited manufacturers continue to be reviewed and documented by the Code Project and Administration Officers and verified by the Textile Clothing and Footwear Union of Australia.

Manufacturers Accredited to the Code are entitled to use the Ethical Clothing Australia label on their garments produced in Australia. The Ethical Clothing Australia label is usually sewn into the garment’s seam alongside the washing instructions, but is sometimes also printed onto the actual garment. The decision whether to use the Ethical Clothing Australia label is up to the Accredited companies.

The Ethical Clothing Australia label is a user-friendly initiative that provides consumers with an identifiable mark to distinguish exploitation-free garments. When consumers see the Ethical Clothing Australia label, they can be confident that the garment was produced in Australia and everyone involved in its production received at least the minimum legal standards.

To visit the Ethical Clothing Australia website, please click here.

The Australian Competition and Consumer Commission authorised a revised form of the Homeworkers Code of Practice for five years.

The Homeworker Code Committee sought authorisation as the Code contains an agreement to only outsource work to contractors who comply with workplace laws.

“The ACCC considers that the Code is likely to provide businesses with a means to manage risks in their outsourced supply chains, and efficiently signal their compliance with workplace legal obligations,” ACCC Commissioner Dr Jill Walker said.

“This will lead to more informed decision making throughout the supply chain. The ACCC also considers that public benefits are likely to arise from greater compliance by businesses with their legal obligations towards vulnerable workers.”

"The revisions to the Code clarify its operation and extend its potential operation to textiles businesses to reflect changes to underlying laws.”

While the ACCC considers that the Code is likely to lead to some anticompetitive detriment, this will be limited by the following factors:

the Code is voluntary;

retail signatories and accredited manufacturers are only able to agree to boycott other businesses that are not compliant with their legal obligations; and

the Code contains safeguards against inappropriate accreditation or boycott decisions.

The ACCC had regard to submissions from interested parties who stated that accreditation under the Code was not voluntary for parties seeking to comply with Commonwealth Procurement Rules.

Ultimately, it is a matter for individual businesses to decide whether or not they tender for Commonwealth projects and therefore must comply with the requirements set by the Government.

“On balance, the ACCC considers the Code is likely to result in net public benefits. The benefits of efficiencies in risk management of outsourced supply chains and of compliance with legal obligations to workers are likely to outweigh the detriments,” Dr Walker said.

Authorisation provides statutory protection for conduct that might otherwise raise concerns under the competition provisions of the Competition and Consumer Act 2010. In general, the ACCC may grant an authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.